Euro compliance implementations

The type of changes that you need to make depend on the currency system used before and after the internal euro initialization.

To comply with the fixed-rate rule (a fixed rate exists between the EMU currency and the euro), the new currency system must be one of these:

  • Single currency or dependent multicurrency, in which the reference currency must be euro.
  • Standard multicurrency, in which the local home currency must be euro, and no restrictions exist for the reference currency.

Internal euro initialization involves changing:

  • The reference currency from an EMU currency to euro (single currency or dependent multicurrency system)
  • The local home currency from an EMU currency to euro (standard multicurrency system).

If you already use the maximum of three home currencies, you can replace one of your home currencies with the euro.

This table shows examples of typical euro compliance implementations. The System and currencies after conversion column contains the specific data defined for the conversion cluster and the conversion-cluster companies.

Examples of euro compliance implementations
System and currencies before conversionSystem and currencies after conversion
Single currency Reference currency = EMU Local home currency = EMU

Standard multicurrency Reference currency = GBP

Local home currency = EUR Reporting currency 1 = GBP

Single currency Reference currency = EMU Local home currency = EMU Single currency Reference currency = EUR Local home currency = EUR
Single currency Reference currency= EMU Local home currency = EMU Dependent multicurrency Reference currency = EUR Local home currency = GBP Reporting currency 1 = EUR
Single currency Reference currency= EMU Local home currency = EMU Dependent multicurrency Reference currency = EUR Local home currency = EUR Reporting currency 1 = GBP
Dependent multicurrency Reference currency = EMU Local home currency = EMU Reporting currency 1 = USD Dependent multicurrency Reference currency = EUR Local home currency = GBP Reporting currency 1 = USD Reporting currency 2 = EUR
Dependent multicurrency Reference currency = EMU Local home currency = EMU Reporting currency 1 = USD Standard multicurrency Reference currency = USD Local home currency = EUR Reporting currency 1 = USD Reporting currency 2 = EUR

Standard multicurrency

Reference currency = USD Local home currency = EMU Reporting currency 1 = USD

Standard multicurrency Reference currency = USD

Local home currency = EUR Reporting currency 1 = USD

 

Note

To be euro compliant, both in a single currency and in a dependent multicurrency system, the reference currency must be euro. If you use a non-EMU currency (for example, American dollars) as your reference currency, and a transaction currency is a (former) EMU currency, your system is not euro compliant because it does not comply with the fixed-rate rule. This restriction regarding the reference currency does not apply to the standard multicurrency system in which the transaction currency is always directly translated into the local home currency.

Enterprises outside the European Union

Enterprises outside the European Union with business partners that use EMU currencies can optionally perform external conversion to change the EMU currencies to euros.

If you still use EMU currencies, you will need to optionally perform external conversion to avoid the use of currencies that no longer exist.